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The P2P Lending Industry Keeps Hitting Records

The P2P Lending Industry Keeps Hitting Records

Peter Renton·
News
··1 min read

I am beginning to sound like a broken record at the end of every month but the numbers just keep getting better. September was another great month for the US p2p lenders Lending Club and Prosper. Both companies kept on their steady growth path when it comes to new loan volume and Lending Club once again broke their record set just last month. The total of both companies came in at just over $32 million.

Lending Club Does a Hair Under $25 Million

Lending Club came within just a couple of loans of $25 million in new loans in September. Their official new loan total for the month was $24.96 million – a record for any p2p lender and roughly $2 million more than last month. But again we had a smaller last day bump than in the past – just under $2 million came in on the last day of the month.

Take a look at the Lending Club chart below. The last seven months has seen Lending Club’s numbers march steadily higher.  The black line is the three month moving average.

Lending Club p2p loan totals Sept 2011

Prosper Up 367% in the Past 12 Months

In the last 12 months Prosper has gone from $2.0 million in new loan volume (September 2010) to $7.4 million a year later, an increase of 367%. This month also marked the 12th month in a row that Prosper has recorded increased loan growth. Their largest investor, worth-blanket2 continued their high level of investment with another $1.8 million invested according to Lendstats. That brings their total investment since coming on board in May to around $7 million.

There is also a new institutional investor that has just started up on Prosper (thanks for the tip Jason) who goes by the screen name of intelligent-repayment8. They don’t look like they are in the same league as worth-blanket2 but they have invested $140,000 since coming on board on September 27th, just three days ago. They are certainly an investor I will be keeping an eye on.

Here is Prosper’s new loan chart for the last 18 months. Volume certainly keeps moving in the right direction.

Prosper New P2P loans Sept 2011

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312-lender
312-lender
Sep. 30, 2011 7:01 pm

To whom it may concern,

Here are a few suggestions I have for Prosper and Folio:
Prosper suggestions:
– a way to filter out all listings with 2 DQs. meaning, a filter that allows me to bid on listings with 0-1 and 3-99 DQs.

Folio Suggestions:
-search notes in folio by the same loan criteria prosper uses
-automated bidding on folio notes once they list
-automated listing of notes once they reach x payments remaining
-ability to create more than 10 listings at a time within Folio
-set folio note price by yield, not just premium

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Peter Renton
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Peter Renton(@peter)
Oct. 1, 2011 6:42 am

@312-lender, Interesting. Even though Prosper’s filtering is far better than Lending Club’s in my opinion it is still not good enough. We need a more robust front end that allows all kinds of inquiries like the one you suggest.

As for Folio this feels like the forgotten stepchild of p2p lending. It is barely functional in its current form and I am always surprised by how many people continue to use it. Good suggestions all of these.

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Charlie H
Charlie H
Oct. 1, 2011 8:20 am

Folio is good for selling loans once they get into th 16 days late catagory. I have had no problem in selling them at ~50% of parr price.

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Peter Renton
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Peter Renton(@peter)
Oct. 3, 2011 10:53 am

@Charlie, Until loans get 30+ days late I think you can always provide a big discount to offload them. But once they hit 31 days, I found it very difficult to sell loans even at a discount greater than 50%.

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Michael
Michael
Oct. 3, 2011 1:26 pm

Peter and Charlie

Do you recommend selling notes right away that are late (in grace)? And if so, what have you found is a good discount price? Do you know if you can write off the loss at tax time?

Thanks.

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Peter Renton
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Peter Renton(@peter)
Oct. 4, 2011 10:30 am

@Michael, I don’t bother selling notes that go into grace period. Maybe I should but I have found that at least 50% that go into grace period come back to current and are then fine. It is up to you, Lending Club claims that there is a 83% recovery from loans that go into In Grace Period but I have found that number to be a little high. But I wouldn’t be discounting too much for loans that may come back to current.

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Charlie H
Charlie H
Oct. 4, 2011 5:52 pm

I’d say that ~75% of loans that hit Grace become current. In deed I have 3 notes that have hit grace 7-8-8 months in a row, but always end up paying.

So, no I do not sell notes when they are in grace. I sell the notes as so as they hit 16-30 days late for 50% below parr.

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